MANILA, Philippines — Supreme Court Associate Justice Antonio Kho Jr. on Tuesday suggested that it may be time to overhaul the Philippine Health Insurance Corporation (PhilHealth) due to its alleged failure to comply with legal funding requirements.
Kho made the statement during oral arguments on the transfer of P89.9 billion in PhilHealth’s excess reserve funds to the National Treasury, questioning the agency’s handling of its budget.
Concerns Over PhilHealth’s Budget Practices
Kho raised concerns over how PhilHealth determines its budget requests, noting that the law mandates funding from various tax collections, including sin taxes and gaming revenues.
“Probably it’s time to overhaul PhilHealth and change the board for not complying with what the law requires,” Kho told Department of Health (DOH) spokesperson Albert Domingo.
“Hindi kasalanan ng tao ‘yan for not availing all of these benefits. Apparently, from your own words, kasalanan ‘yan ng administration, this administration, last administration, or the previous administration, at kasalanan ‘yan ng PhilHealth board,” he added.
(This is not the people’s fault for not availing of these benefits. Apparently, from your own words, that is the fault of the administration—this administration, the last administration, or the previous administration—and the PhilHealth board.)
Funding Sources and Alternative Budget Computation
Kho pointed out that Section 37 of the Universal Health Care Act outlines specific sources of funding for PhilHealth, including:
- Total incremental sin tax collections
- 50 percent of the national government’s share from PAGCOR (Philippine Amusement and Gaming Corporation) revenues
- 40 percent of the PCSO (Philippine Charity Sweepstakes Office) charity fund, excluding documentary stamp tax payments
- Mandatory premium contributions from members
- Annual appropriations of the DOH under the General Appropriations Act (GAA)
- National government subsidies provided through the GAA
However, Domingo admitted that the DOH follows a different formula from what the law prescribes.
“It does not refer to the computation on the sin tax allocation,” Domingo said, explaining that PhilHealth bases its budget requests on the number of indirect members multiplied by the corporation’s premium rate.
Kho then questioned whether PhilHealth was disregarding its legal funding sources, to which Domingo responded that PhilHealth prioritizes needs-based allocation rather than relying solely on government revenue projections.
Budget Limits Restricting Healthcare Access
Kho criticized PhilHealth for imposing its own funding restrictions, which he believes prevent the agency from fully addressing the healthcare needs of Filipinos.
“The problem is PhilHealth limits the funding so that you don’t address the health needs of the Filipino people. If you increase the budget by 200 percent, I don’t think the Filipinos would not avail of that. You define your own limits,” he stated.
He further questioned whether PhilHealth’s budget formulation ignored the congressional allocation of funds for healthcare subsidies.
“The Congress allocates budgets, provides collections of taxes to answer for the subsidy of PhilHealth for indirect contributors. Now, when you request money for subsidy, does that mean you will disregard that? You will make your own formula, because you have limited understanding, need of our people for health?” he asked.
Call to Return P60 Billion to PhilHealth
Domingo acknowledged that the Marcos administration agrees with Kho’s observations, describing it as a “strong signal” for PhilHealth to expand its healthcare benefits.
Kho emphasized that this recognition should also prompt the government to return the P60 billion that PhilHealth had previously transferred to the National Treasury.
“As long as the government recognizes now, it is now incumbent on the part of the government to return the 60 billion that was transmitted already because it is recognized now,” he said.
He suggested that PhilHealth could formally request President Ferdinand Marcos Jr. to return the funds, which could then be used to expand benefits and hire more medical personnel to enhance healthcare services.
“Return that to PhilHealth to expand its benefits, hire more people to answer for the needs of the health of our people,” Kho added.
